Texas legalized hemp cultivation and processing under the 2018 Farm Bill and the Texas Hemp Plan administered by the Texas Department of Agriculture. While Texas has not legalized recreational cannabis, hemp and CBD businesses can access certain federal and state programs. Understanding what is and is not available — and the regulatory boundaries — is critical for hemp entrepreneurs in Texas.
What Is Legal in Texas
- Hemp cultivation: Legal under TDA license for hemp containing less than 0.3% THC
- Hemp processing: Legal for processing hemp into fiber, grain, and CBD products
- CBD products: Legal for sale if derived from compliant hemp and properly labeled
- Cannabis (marijuana): Not legal for recreational use in Texas. The Compassionate Use Program permits very limited medical use of low-THC cannabis.
Available Federal Programs
- USDA programs for hemp: Since the 2018 Farm Bill classified hemp as an agricultural commodity, hemp growers can access USDA programs including crop insurance, FSA loans, and certain conservation programs. FSA loans guide.
- USDA Value-Added Producer Grant: Hemp producers adding value (CBD extraction, fiber processing) may qualify. VAPG guide.
- SBA lending: The SBA updated its lending policies to allow loans to businesses involved in legal hemp production and sales. SBA 7(a) and 504 loans are available. SBA 7(a) guide.
- SBIR/STTR: For hemp-related technology and agricultural innovation through USDA and NIH
Programs That Are NOT Available
- Most federal programs remain unavailable for businesses involved with marijuana (THC above 0.3%)
- SBA loans are not available for marijuana businesses
- Federal banking restrictions still apply to marijuana-related businesses
State Resources
- TDA Hemp Program: Licensing, compliance, and regulatory guidance for hemp cultivators and processors
- GO TEXAN: Marketing support for Texas agricultural products including hemp
- Texas A&M AgriLife: Research and technical assistance for hemp cultivation in Texas conditions
Complementary Programs
- R&D tax credits: For hemp processing technology development
- USDA REAP: For energy efficiency and renewable energy at processing facilities. REAP guide.
Bottom Line
Legal hemp businesses in Texas can access USDA agricultural programs, SBA lending, and standard business incentives. The key is operating within the legal hemp framework (under 0.3% THC) and maintaining TDA licensing compliance. Marijuana businesses face significant federal program restrictions regardless of any future state policy changes.
Not sure which programs may fit your hemp or CBD business? Our free screening report checks your business against 150+ verified programs — grants, tax credits, loans, and incentives — and shows you which ones may match. Start your free screening →